Friday, March 16, 2012

Apple kept its hold on top spot, as it did in January. With a $0.5+ Trillion market cap it feels like the stock is carrying the entire market rally on its back. But what of the 'also rans'? This month's list is one of the most eclectic which makes a change from the normally commodity-heavy components.

• % Chg EPS; Q to last yr Q of 25% or more
• % Chg EPS; YTD to last YTD of 25% or more
• % Chg Revenue; YTD to last YTD of 25% or more
• Return on Average Equity of 17% or more
• 5-yr Revenue Growth Rate of 15% or more
• Market Cap of at least $50M
• Net Profit Margin of 18% or More
• Current price above $12
• Average 10-day volume above 250,000 shares

It's hard to think Apple was toiling around $363 in late November, stuck as it was in a trading range. At $585 a ticket it's somewhat rich to be buying; 20% above its 50-day MA and 46% above its 200-day MA it would need either to come back to one of these moving averages, or 'wait' for the moving average to catch up with price (by moving sideways for a time). The new iPad is out, so it's stuck in a bit of a news lull and Q2 earnings not due until the end of April. Given the blowout Q1 it's unlikely to repeat the performance in Q2; this might be the 'disappointment' the stock needs to skim the froth off the price.

In second spot (but up two spots from January), with just a tenth of Apple's Market Cap, is Baidu (BIDU). The stock is caught in a broad trading range, but is applying pressure to supply at $140 resistance. In the next couple of weeks it should have enough to see $140 broken and start a move to $155. The company releases earnings on April 26th as is projecting a soft Q1 after very strong quarterly earnings growth in 2011. If there is any lingering goodwill from Q4 it could deliver a positive surprise and setup a challenge of $165.

In third spot is Apache Corp. (APA). This oil and gas exploration company has jumped into the top-3 having never previously featured on the scan. This sector is regaining its mojo as rising oil prices make it an attractive commodity play. The stock successfully broke through - and retested - its 200-day MA in February and is in the process of creating a 'Golden Cross' with its 50-day MA. How much demand is in this rally will be tested when it gets to $115 and above. A break of $133 will put it into the clear.

In fourth spot is Potash Saskatche (POT). Unlike the previous three stocks this isn't experiencing a price revival. It currently trades below its 50-day MA and a downtrending 200-day MA, caught inside a $39-47 trading range. Optimistic bulls may look for a reversal head-and-shoulder pattern; if this was to play true then $42 would have to hold as support as this looks to be the swing low for the right-hand-shoulder of this pattern. Supply kicks on a test of the 200-day MA and/or $50 - the latter was support for the first part of 2011. The company disappointed in its Q4 release, but it did off a series of strong quarters. If this proves to be just a blip in the larger scheme of things it might be offering good value, just know your risk. Use Zignals Alerts to tell you when a certain price is broken.

In fifth place is a biotech stock, Celgene (CELG). The stock enjoys the dual benefit of consistent earnings growth and increasing demand. Other than Q4 it usualy beats Wall Street Estimates and if it was to resume its past form it could contribute a solid boost to an already strong stock. The stock is currently trading in the upper range of its channel, but buyers might be tempted if it was to undercut the 50-day MA, but stay within the confines of the channel.

In sixth spot is Priceline (PCLN). This stock has been consistently there or thereabouts as others jumped in and out of the list. This good form eventually paid dividends as the long standing trading range from 2011 between $450 and $550 was sliced in 2012. It quickly added $100 and is looking to surge again. Its consistency extends to Wall Street Estimates which have closely matched actual values. Q1 is a traditionally weak period for the travel company, although it's expected to exceed Q1 earnings from last year by nearly 60%.

In seventh spot is another list lurker in HDFC Bank (HDB). Unlike Priceline (PCLN) it hasn't enjoyed the same success and remains locked in a trading range. While financials are catching a bid it's unlikely to see a significant increase in demand until $36.50 resistance is taken out.

The last stock on the list is Alexion Pharmaceuticals (ALXN). Like Celgene (CELG) it has enjoyed excellent quarterly earnings growth, exceeding analyst estimates to a greater degree than Celgene. Another strong quarter is projected for Q1. The stock is up against resistance of a bullish channel started in the summer of 2011. The stock may be about to enter another consolidation phase as it did in October 2011 as it 'waits' for its 50-day MA to catch up with the advance. The stock looks to have an active bid around $84, so stop placement should go somewhere below this.

Apple kept its hold on top spot, as it did in January. With a $0.5+ Trillion market cap it feels like the stock is carrying the entire market rally on its back. But what of the 'also rans'? This month's list is one of the most eclectic which makes a change from the normally commodity-heavy components.

• % Chg EPS; Q to last yr Q of 25% or more
• % Chg EPS; YTD to last YTD of 25% or more
• % Chg Revenue; YTD to last YTD of 25% or more
• Return on Average Equity of 17% or more
• 5-yr Revenue Growth Rate of 15% or more
• Market Cap of at least $50M
• Net Profit Margin of 18% or More
• Current price above $12
• Average 10-day volume above 250,000 shares

It's hard to think Apple was toiling around $363 in late November, stuck as it was in a trading range. At $585 a ticket it's somewhat rich to be buying; 20% above its 50-day MA and 46% above its 200-day MA it would need either to come back to one of these moving averages, or 'wait' for the moving average to catch up with price (by moving sideways for a time). The new iPad is out, so it's stuck in a bit of a news lull and Q2 earnings not due until the end of April. Given the blowout Q1 it's unlikely to repeat the performance in Q2; this might be the 'disappointment' the stock needs to skim the froth off the price.

In second spot (but up two spots from January), with just a tenth of Apple's Market Cap, is Baidu (BIDU). The stock is caught in a broad trading range, but is applying pressure to supply at $140 resistance. In the next couple of weeks it should have enough to see $140 broken and start a move to $155. The company releases earnings on April 26th as is projecting a soft Q1 after very strong quarterly earnings growth in 2011. If there is any lingering goodwill from Q4 it could deliver a positive surprise and setup a challenge of $165.

In third spot is Apache Corp. (APA). This oil and gas exploration company has jumped into the top-3 having never previously featured on the scan. This sector is regaining its mojo as rising oil prices make it an attractive commodity play. The stock successfully broke through - and retested - its 200-day MA in February and is in the process of creating a 'Golden Cross' with its 50-day MA. How much demand is in this rally will be tested when it gets to $115 and above. A break of $133 will put it into the clear.

In fourth spot is Potash Saskatche (POT). Unlike the previous three stocks this isn't experiencing a price revival. It currently trades below its 50-day MA and a downtrending 200-day MA, caught inside a $39-47 trading range. Optimistic bulls may look for a reversal head-and-shoulder pattern; if this was to play true then $42 would have to hold as support as this looks to be the swing low for the right-hand-shoulder of this pattern. Supply kicks on a test of the 200-day MA and/or $50 - the latter was support for the first part of 2011. The company disappointed in its Q4 release, but it did off a series of strong quarters. If this proves to be just a blip in the larger scheme of things it might be offering good value, just know your risk. Use Zignals Alerts to tell you when a certain price is broken.

In fifth place is a biotech stock, Celgene (CELG). The stock enjoys the dual benefit of consistent earnings growth and increasing demand. Other than Q4 it usualy beats Wall Street Estimates and if it was to resume its past form it could contribute a solid boost to an already strong stock. The stock is currently trading in the upper range of its channel, but buyers might be tempted if it was to undercut the 50-day MA, but stay within the confines of the channel.

In sixth spot is Priceline (PCLN). This stock has been consistently there or thereabouts as others jumped in and out of the list. This good form eventually paid dividends as the long standing trading range from 2011 between $450 and $550 was sliced in 2012. It quickly added $100 and is looking to surge again. Its consistency extends to Wall Street Estimates which have closely matched actual values. Q1 is a traditionally weak period for the travel company, although it's expected to exceed Q1 earnings from last year by nearly 60%.

In seventh spot is another list lurker in HDFC Bank (HDB). Unlike Priceline (PCLN) it hasn't enjoyed the same success and remains locked in a trading range. While financials are catching a bid it's unlikely to see a significant increase in demand until $36.50 resistance is taken out.

The last stock on the list is Alexion Pharmaceuticals (ALXN). Like Celgene (CELG) it has enjoyed excellent quarterly earnings growth, exceeding analyst estimates to a greater degree than Celgene. Another strong quarter is projected for Q1. The stock is up against resistance of a bullish channel started in the summer of 2011. The stock may be about to enter another consolidation phase as it did in October 2011 as it 'waits' for its 50-day MA to catch up with the advance. The stock looks to have an active bid around $84, so stop placement should go somewhere below this.

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